‘S.O.S.’ Digital-Transition Proposal Lacks Support

A digital-transition proposal -- for operators to provide free cable TV service in exchange for carriage of a broadcasters’ signals -- has failed to muster support from the cable industry, according to the plan’s creator.

Back in June, Ohio-based Massillon Cable TV first met with federal regulators to discuss its so-called “Save Our Sets,” or S.O.S., plan, which was meant to ease the pain of the transition to the all-digital delivery of broadcast signals on Feb. 17, 2009. 

But the S.O.S. proposal hasn’t been able to pick up any steam from groups such as the American Cable Association, a lobbying organization for small cable operators, or the National Cable Television Association.

“The Save Our Sets coalition is sort of on hold for lack of cable-industry support, but it still exists in case this idea returns as we get closer to the actual transition date,” said Massillon cable TV president Bob Gessner,  who had brought his proposal to the Federal Communications Commission this summer.

Under Gessner’s S.O.S. proposal, mutichannel video providers would hook up TV service -- to provide the analog version of each local TV station’s primary broadcast signal and their digital multicasts -- for anyone who is not a current subscriber for seven years – all for free.

Broadcast-only consumers would then surrender $40 government-issued coupons -- meant for them to buy boxes to convert digital signals to analog -- to cable operators such as Massillon. These operators would then return the coupons to the federal government, for recirculation. 

In exchange, the cable company would get free retransmission consent for the local TV stations’ signals for seven years.

“It was great that Bob came up with a plan,” said ACA chairman Patrick Knorr, who is also general manager of Sunflower Broadband. “But I think the biggest issue there just wasn’t a lot of industry interest. It [the plan] just did not fit many operators’ needs and I think many operators had concerns with it. ”

For one, some cable operators didn’t like the idea of offering TV service for free, according to Knorr. Under S.O.S., operators would bear the cost of maintaining and connecting homes and all their TV sets.

“And there was a lot of concern over the practicality of actually getting retrans [under Gessner’s proposal],” Knorr said.

There were also worries that either the FCC or Congress “could cherry pick provisions of it [S.O.S.] and turn it into a mandate,” according to Knorr.

And the proposal didn’t address dual-carriage, the FCC mandate that cable systems that don’t convert to an all-digital platform by Feb. 17, 2009, will have to offer viewers analog and digital signals of TV stations that request carriage, according to Knorr.

 “If you were in a certain situation and all the stars aligned, it [S.O.S.] was a great, great plan,” Knorr said. “But a lot of assumptions were required, and a lot of operators just weren’t even comfortable that even if the assumptions aligned, that the math would work.”

The S.O.S. plan had won a few supporters along the way, namely Comporium Communications of Rock Hill, S.C., and Broadstripe, formerly Millennium Digital Media, in St. Louis, as well as a big TV-station group owner than Gessner declined to identify.

Nonetheless, the plan “really did not generate the kind of industry support that it needed to sustain the effort,” said Gessner, who believed his proposal was a way for cable companies to take a proactive role in the digital transition, one that would benefit them.

For example, broadcasters have been demanding cash in exchange for cable operators carrying their TV stations, and under S.O.S.  cable companies would have received those signals for free.

There was another S.O.S. benefit as well, according to Gessner. Operators could “upsell” homes they wired as part of S.O.S., charging customers if they then wanted TV channels beyond just their local broadcast-stations’ signals, he said.

Most recently, the ACA has been lobbying to get an exemption of the dual-carriage rules for small cable operators.

“Potentially, it’s [dual carriage] going to put a lot of small systems out of business,” Knorr said. “A 100-sub system doesn’t have the money to go digital, and doesn’t have the capacity to carry both an analog and a digital HD signal.”